Sum of the year's digits is 5 + 4 + 3 + 2 +1 = 15 years.
Depreciation base: 32,000 - 2,000 = 30,000
The depreciation applied in any year is the depreciation base times (number of years remaining divided by 15). The first year has the highest depreciation, and the fifth year has the lowest.
Depreciation:
1st Year: Dep Base x 5/15
2nd Year: Dep Base x 4/15
3rd Year: Dep Base x 3/15
4th Year: Dep Base x 2/15 = 30,000 x 2/15 = 4,000
5th Year: Dep Base x 1/15
Answer is $4,000
Answer:
A. Overhead allocation rates based on direct labour hours = $18 per direct labour hour
B. Overhead allocation based on direct labour cost = 0.6
C. Overhead allocation rates based on machine time = $40 per machine time hour
Explanation:
Here, we are interested in having some calculations done; We proceed as follows;
From the question, the total overhead = 810,000
Mathematically;
a. The overhead allocation rates based on direct labour hours = Amount of total overhead/Total direct labour hours
= 810,000/45,000 = $18 per direct labour hour
b. The overhead allocation based on direct labour cost = Amount of total overhead / Total direct labour costs
= 810,000/1,350,000 = 0.6
C. Overhead allocation based on Machine time = Amount of total overhead/total machine time hours = 810,000/20,250 = $40 per machine time hour
Given:
280,000 for the land
110,000 for the old bldg
33,500 to tear down old bldg
47,000 to fill and level the land
1,452,000 new bldg
87,800 for lighting and paving a parking area for the new bldg.
Entries: Debit Credit
Land 470,500
Cash 470,500
(280,000 + 110,000 + 33,500 + 47,000 = 470,500)
Building 1,452,000
Cash 1,452,000
Land Improvement 87,800
Cash 87,800
Expenses incurred in preparing the land for its purpose is classified under the land account. Land does not depreciate because its useful life is unidentified.
Land improvement account is used for expenses incurred to add functionality to the land and these output has useful life and is depreciated.
Answer:
1. 0.35%
2. 1.15%
Explanation:
The federal funds rate is the rate at which a bank can borrow funds from other depository institutions such as other banks and credit unions for overnight without collaterals. It is a very short term interest rate.
Discount rate at which the federal reserve system provides funds to commercial banks at the discount window. The federal reserve can control the money supply by changing the discount rate.
Here, in the given example, the federal reserve rate is 0.35%, as it is the rate at which the bank can borrow from other banks. While the discount rate is 1.15%, as this is the rate at which banks can borrow from the federal reserve.
